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Health charities and campaigners have voiced concern at the prospect of Philip Morris International (PMI) winning the quickfire auction for the pharmaceutical company Vectura announced by regulator The Takeover Panel on Monday 9th August. The five-day auction between PMI and private equity group Carlyle will begin on Wednesday if final bids are not forthcoming by 5pm on Tuesday 10th August.
Shares in Vectura gained 5% to reach 172p on Monday 9th August as investors responded to the announcement. The company is now valued at more than £1bn. The latest bids from PMI and Carlyle see PMI value Vectura at £1.02bn (165p a share) whilst Carlyle values the firm at £928m (155p a share). Vectura’s board had previously recommended that investors accept the offer from Carlyle but withdrew that recommendation on Monday 9th August when PMI came in with an improved offer.
Health charities have reiterated their concern at the prospect of an auction won by PMI. Malcolm Clark, senior cancer prevention policy manager at Cancer Research UK, said: “It’s clear there’s more at stake in the outcome of this deal than the share price. It’s unethical for big tobacco to be allowed to profit from treating diseases made far more prevalent because of its products.”
Sarah Woolnough, chief executive of Asthma UK and the British Lung Foundation, said: “It is unacceptable that companies that have profited from the devastation smoking causes could then make even more money providing treatments for the illnesses they have caused.”
Woolnough and Clark both warned that the company could be blocked from taking part in research programmes with universities if it accepts PMI’s bid. Clark said governments and health agencies would be forced to “limit their interactions” with the company. Dr Nick Hopkinson, clinical lead for COPD at the Royal Brompton hospital in west London and chair of public health charity ASH, added that scientists who work for a PMI-owned Vectura “may no longer be able to collaborate with their peers.”
Source: The Guardian, 9 August 2021
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Alistair Osborne, commentator for The Times, argues that Vectura’s board must make the ethical decision and reject Philip Morris International’s (PMI) bid.
Osborne criticises Vectura’s board for keeping PMI in the running for takeover of the company. He says that Vectura’s board only recognised that there was something amiss in selling the work of the company’s 200 scientists to a cigarette company following backlash from public health charities but should have recognised the problems sooner. Osborne says the deal would see a company which gives you chronic pulmonary disorder then able to rip consumers off for its treatment. Moreover, it would damage Vectura because health authorities and pharmaceutical partners may refuse to work with big tobacco.
Osborne says that Vectura’s directors only woke up to these realities when Carlyle submitted a higher offer than PMI on Friday 6th August. Directors then cited the “the reported uncertainties relating to the impact on Vectura’s wider stakeholders” from selling to PMI. Osborne says that The Takeover Panel’s decision to call an auction is to stop Vectura from being subjected to a drawn-out siege. While the auction will ensure the best price for Vectura’s shares, Osborne says it ‘’doesn’t get Vectura’s board or shareholders off the hook’’.
Osborne argues that if the bidding is close then Vectura’s board could and should argue that its “fiduciary duties” extend to backing a lower Carlyle offer that is better for the inhaler group and its workers. He argues that the firm’s shareholders’ ''environmental, social and governance guff’’ must actually mean something and calls on them to make a ''proper stand’’ on their purported corporate social responsibility.
Source: The Times, 10 August 2021
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The British Heart Foundation (BHF) has warned that the number of people waiting for heart surgery in England could rise by more than 40% by next Spring. BHF said that more government money was needed or it would take up to five years for cardiac services to return to pre-Covid levels.
The BHF said the number waiting for heart surgery such as a heart bypass or transplant in England is predicted to rise from 11,000 to more than 15,000 by February 2022. The number waiting for more general heart care like diagnostic scans and treatment such as stents could reach 500,000 by early 2024, doubling the levels seen before the pandemic in February 2020.
"Delay in diagnosis and treatment of cardiovascular diseases is not just about improving symptoms, however important that is - it is about saving lives," said Prof Sir Nilesh Samani, medical director at the BHF. "Tragically, we have already seen thousands of extra deaths from heart and circulatory diseases during the pandemic, and delays to care have likely contributed to this terrible toll." The charity said that it wanted to see an above-inflation rise in health spending and a plan to recruit more heart specialists.
The charity's warning comes just a day after new analysis suggested nearly 14 million people could be on NHS waiting lists in England by next autumn. A backlog is predicted as patients who did not come forward during the pandemic now seek treatment and join waiting lists for routine operations.
Source: BBC News, 9 August 2021
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The Institute of Economic Affairs (IEA) has lost a two-year battle with LBC radio presenter James O’Brien over claims that the registered charity and thinktank is a politically motivated lobbying organisation funded by ‘’dark money’’.
The IEA complained to media regulator Ofcom that the radio station had made a series of inaccurate and unfair suggestions that the organisation is a professional lobby group of “questionable provenance, with dubious ideas and validity” staffed by people who are not proper experts on their topic. The free market thinktank particularly objected to O’Brien’s dismissive description of an IEA representative as “some Herbert” as well as guest Peter Geoghegan’s suggestion that the IEA was “politically biased” during a discussion on the funding of thinktanks.
O’Brien also described the organisation as a “hard-right lobby group for vested interests of big business, fossil fuels, tobacco, junk food” and urged newspapers to stop quoting from an organisation that is registered as “as an educational charity because they don’t reveal who funds them”. The IEA had responded by claiming that any implication that the organisation was engaged in illegal lobbying on behalf of corporations is false.
However, the IEA has repeatedly failed to reveal its funders. During the negotiations over the terms of Britain’s exit from the EU IEA boss Mark Littlewood was filmed by an undercover reporter saying it was “in the Brexit influencing game” and offering to arrange meetings with ministers. In February 2019 the Charity Commission formally warned the IEA about using its resources to campaign for a hard Brexit. After a lengthy investigation, the media regulator Ofcom has now cleared LBC of any wrongdoing over the discussions on O’Brien’s shows, which took place in early 2019.
Source: The Guardian, 9 August 2021
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New research from the Prevention Research Center of the Pacific Institute for Research and Evaluation investigating the effects of California’s 2016 law raising the minimum age of sale for tobacco from 18 to 21 has found evidence that the new law has had a positive public health effect on 7th, 9th, and 11th grade students across California.
Results showed that the law was associated with reduced prevalence of lifetime smokeless tobacco and past month smokeless tobacco use in the overall student population, reductions in lifetime and past-30-day use of all tobacco and nicotine products amongst Latinx youth, and differential but positive public health effects on other racial and ethnic groups. It has also led to increases in the prevalence of past month e-cigarette use but a reduction in lifetime e-cigarette use in the student population.
Source: Medical Xpress, 9 August 2021
See also: BMJ Tobacco Control - California's tobacco 21 minimum sales age law and adolescents' tobacco and nicotine use: differential associations among racial and ethnic groups
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The thinktank The International Institute of Legislative Affairs (ILA) has warned that Kenya’s new Finance Act 2021 includes some changes in the law that will benefit tobacco companies.
The ILA cites Section 12(d) of the Act which introduces new regulations on income tax, giving a minimum tax break for individuals engaged in particular kinds of business. It states that a person shall not pay the minimum tax amount if they are engaged in distribution business whose income is wholly based on a commission.
The ILA says that this exemption for commission-based individuals will benefit tobacco firms who engage distributors who are covered by the exemption to push their products onto the Kenyan market. “While positive for other groups, it will encourage tobacco distributors to exert more effort in flooding the market with tobacco and nicotine products thus increasing prevalence of the same products among consumers,” says the ILA.
The ILA also criticised the allocation of only Sh121 billion (£801m) to the Ministry of Health to help deal with the harmful effects of tobacco, with the ILA calling this sum inadequate compared to the allocation to other ministries considering the Universal Health Coverage goal.
However, the ILA also lauded other sections of the new Act which it says will make it harder for tobacco firms to operate profitably. Plain polythene film and air lid papers without absorbent polymer have been added to the Value Added Tax, increasing the cost of these products. “Some of this paper is used by tobacco companies in packaging tobacco and nicotine products and this will consequently increase the production of their final product even further,” says ILA.
Source: The Standard (Kenya), 10 August 2021
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